Reader's Review, March 2013
Anatomy of a Mediation:
A Dealmaker's Distinctive Approach to Resolving Dollar Disputes and Other Commercial Conflicts
Throughout most of his legal career, James Freund was a prominent merger and acquisition specialist with Skadden, Arps. Since he left that firm, he has become a highly respected mediator of business disputes. In this book, he thoughtfully explores the manner in which he works to assist parties resolve such controversies.
In recent years, most books on mediation have focused on the facilitative approach, where the neutral persons serve as negotiation assistants who help disputing parties negotiate with each other to achieve mutually acceptable resolutions. In their classic book The Promise of Mediation (1994), Robert Baruch Bush and Joseph Folger developed a new style of dispute resolution which they call transformative mediation. The designated neutrals demonstrate to disputing parties that they do not have to reach settlement agreements by exploring their non-settlement options and showing them that they do possess meaningful empowerment. They also generate mutual recognition, by working to get each side to appreciate the positions being taken by the opposing side. These books have generally suggested that mediators should not openly assess the validity of party positions, nor should they suggest how those persons should resolve their disputes, to preserve party autonomy.
Freund completely rejects the facilitative and transformative approach and extols the virtue of evaluative mediation. He emphasizes that most of his business disputes concern primarily monetary issues where the parties are trying to determine how much one side should pay to the other. When such conflicts are involved, there is little room to expand the pie and simultaneously advance the interests of both sides. He believes that most of the legal representatives who come before him are capable negotiators who are well prepared. He clearly thinks that what they need most is specific guidance with respect to the manner in which their matters should be settled. In a brief joint opening session, he explains his evaluative style and emphasizes how he will work to preserve party confidentiality. He then begins to meet with each side in separate caucus sessions. When facilitative mediators conduct such caucus sessions, they endeavor to learn things parties are not yet willing to disclose to their opponents, and they look for ways to regenerate stalled inter-party bargaining discussions. They act as conduits through which the disputants negotiate with each other.
When Freund conducts separate caucus sessions, he directly negotiates with each party personally. He carefully listens to their positions and explores their underlying interests, but then directly expresses his view regarding the merits of their contentions. He begins to suggest how he believes they should resolve the controversy. Unlike more conventional mediators, he does not convey each party's positions to the opposing side. He continues to work with both sides separately until they begin to get closer to each other. When he feels he understands where the disputants should end up, he lets each side know what these terms are - but he does it separately, to enable him to provide the different parties with differing explanations designed to appeal to their respective interests. On some occasions, he expressly reserves the right, when such direct efforts do not produce mutually acceptable resolutions, to make final recommendations that may only be accepted or rejected.
The book has five major divisions. In Part I, Freund talks about why disputing business persons should consider mediation and the potential benefits they are likely to derive from such external assistance. He explores likely obstacles to settlements, and how they might be overcome. He also discusses the attributes possessed by proficient mediators. He discusses how parties and mediators should prepare thoroughly for their interactions to enable them to use the neutral-assisted process effectively.
In Part II, Freund explores the way in which he mediates pure dollar disputes. He begins with joint sessions to allow the parties to hear the basic issues, and then he moves quickly to separate caucus sessions where he directly negotiates with each side. He carefully listens to the concerns of each party and allows them to articulate the merits of their positions. Once he understands their perspectives, he openly indicates his view regarding the strengths and weaknesses of their positions. He directly negotiates with each side in an effort to get them moving toward one another. Once he fully appreciates the basic issues involved and the way the parties would like to see the matter resolved, he formulates the manner in which he thinks the controversy should be resolved. He does not convey offers from one side to the other, but goes back and forth between them in an effort to move them closer together. In this regard, he completely controls the bargaining process. Even when he articulates the way he thinks the parties should settle, he does not disclose either side's current positions. He simply works to get them to agree to terms he believes they will both accept. When such efforts fail to generate final terms, he does not hesitate to determine precisely where he thinks the two sides should end up, and he explains his proposed terms separately to each.
In Part III, Freund explores the mediation of a dispute between business partners endeavoring to terminate their relationship. He meets separately with each side and listens carefully to determine their different perspectives. Once he appreciates their respective viewpoints, he asks each how they believe the matter should be resolved. He openly indicates the degree to which he finds their positions persuasive. He then begins to negotiate separately with each in an effort to bring them closer together. Even though he is personally bargaining with each side and is not conveying their offers back and forth, he works diligently to ascertain the optimal result for both sides.
In Part IV, Freund explores multi-party disputes with a hypothetical matter involving the purchase and sale of a hotel and casino. He discusses how he works to determine the optimal arrangement that will satisfy the interests of the different parties, and how he endeavors to sell that deal to those groups. If he is unable to get unanimous consent, he finally puts together an overall agreement which each party must simply accept or reject. The parties must all deal directly with him, and he works to preclude direct inter-party negotiations.
Many mediation books are highly theoretical. The authors assume an ideal world and discuss what skilled facilitative and transformative mediators do to resolve disputes. Many assume that mediators never offer their own evaluations of the matters in question, and never tell the disputants what they should do. Although I consider myself to be a facilitative mediator, I am amazed how often I provide some evaluative information to the different sides. I do this sometimes in response to party requests for such assessments, and sometimes in an effort to deal with clients or even lawyers who have unrealistic expectations. When I talk with other facilitative mediators, they almost always admit to providing evaluative information to disputants when necessary to move the process forward. In this regard, the mediation style of Freund is not exceptional. On the other hand, his willingness to actually tell disputing parties what they should accept goes beyond what traditional facilitative neutrals would normally do. The fact that he regularly achieves mutual accords attests to his ability to employ this highly directive approach in an effective manner. He is undoubtedly assisted by the expansive knowledge he developed over many years of bargaining about business disputes.
This is a highly practical book. Freund carefully explains how he uses an evaluative/directive style to generate settlement agreements - especially those involving monetary disputes. He is careful not to simply impose his will on parties. He explains how he meets several times with each party in separate caucus sessions to hear their positions and their interests, and how he then negotiates with each to move them in a direction likely to result in a final resolution. When he suggests what the disputants should finally accept, his recommendation is based upon his understanding of their concerns. He works to develop agreements that best advance their joint interests.
This is an excellent book for persons who consider using the evaluative/directive mediation style, and for lawyers and business persons thinking of employing such mediators to help them resolve monetary - and even multi issue - disputes. Even facilitative mediators should gain an appreciation of how evaluative advice can assist parties move toward final agreements.
Charles B. Craver
Charles B. Craver is the Freda Alverson Professor of Law at George Washington University. He is the author of Effective Legal Negotiation and Settlement(7th ed. 2012 LEXIS); Skills & Values: Legal Negotiating(2nd ed. 2012 LEXIS); and The Intelligent Negotiator (2002 Prima/Crown). He is the coauthor of Skills & Values: Alternative Dispute Resolution (2013 LEXIS), Alternative Dispute Resolution: The Advocate's Perspective (4th ed. 2011 LEXIS), and Legal Negotiating (2007 West). Over the past thirty-five years, he has taught negotiation skills to 90,000 attorneys and business persons throughout the United States and in Canada, Mexico, Puerto Rico, Austria, England, Germany, Turkey, and China. He can be reached at firstname.lastname@example.org
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Copyright © 2013 Charles B. Craver
Copyright © 2013 The Negotiator Magazine
The Negotiator Magazine (March, 2013)